With more than 1,000 buildings totaling nearly 42 million square feet of space, Orange County’s research and development sector accounts for roughly 17% of the region’s industrial base.
The research and development sector saw a relatively steady 2007, keeping the same pace into the first quarter.
In the first quarter, the research and development sector saw 501,297 square feet of absorption. Continuing its pace from the previous quarter, vacancy and availability rates remained stable.
As it stands, there is more than 1.1 million square feet of vacant research and development space. This yields a low vacancy rate of 2.7%, which remains unchanged from the previous quarter but represents a 7% decline from the previous year’s rate of 2.9%.
The sector’s availability rate stood at 7.5% in the first quarter, rising slightly from 7.4% in the fourth quarter, yet up from the past year, which stood at 5.2%.
The first quarter did see 21,110 square feet of negative absorption, which was mainly concentrated in the West and North County submarkets.
South County offset the negative absorption with 132,246 square feet of absorbed space.
The average monthly asking lease rate stands at $1.03. While this remains the same as the fourth quarter, it represents a 5 cent increase from the average rate in 2007.
When compared to the manufacturing and warehouse market, the growth of research and development space is slow. There was only one research and development building totaling 61,003 square feet under construction in the first quarter.
Furthermore, an increasing number of developers are constructing as well as converting traditional industrial properties into smaller research and development condominiums for sale.
Data and analysis provided by CB Richard Ellis Research.
The Real Estate Watch Chart – Net Absorption, Rates, etc. is provided in a Adobe Reader .pdf print-friendly file.
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REAL ESTATE WATCH CHARTS
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